These claims adjusters work for Maui fire policyholders

By Doug Bailey

In 35 years as a public insurance claims adjuster, Steve Severaid hasn’t seen anything that compares to the devastation he’s witnessed in Maui, following the raging fires that swept through the Hawaiian island.

Beyond the massive property damage, lives were upended. People lost homes, jobs, loved ones, and above all else, hope.

“Maui is such a resort destination and the downtown really got wiped out, all the restaurants and businesses are gone,” he said. “You have people who have lost their home, lost a place to live in an already tight housing market, and business owners who have not just lost their businesses but all the local people they employed have lost their jobs.”

Public claims adjusters navigate claims process

Severaid and his public claims adjuster company, Adjusters International Pacific Northwest, is in the business of representing insured residents and business owners who have been victimized by a natural disaster, most frequently fires, to help them receive an optimal or even adequate payout from their insurance claims. Severaid and his colleagues aid policyholders navigate the sometimes-byzantine claims process and, though they definitely can be a headache to the insurance company adjusters, they say the process is not necessarily adversarial.

“Our function is not to be part of the insurance company's team, but to be part of the policyholders’ team,” says Severaid, referring to public claims adjuster companies. “Insurance company adjusters represent the insurance company and their interests don’t align with the policyholder’s.”

It’s not that insurance companies necessarily want to deprive policyholders or unfairly reduce their claims, he says. But their job is to minimize company losses as best they can, and many policyholders don’t even realize public adjusters exist and insurers would probably like to keep it that way.

A little-known resource

“If you have a legal problem, you're trained to know that you can go get a lawyer,” he says. “And if you have a tax problem, you're trained to know that you might need a CPA. But when it comes to insurance claims, most people have never heard of companies like ours. Even sometimes insurance agents themselves and their company attorneys don't know about public adjusters.”

The hard truth, Severaid says, is that an insurance policy’s coverage amount doesn’t necessarily guarantee an optimal payout or even an adequate claim. Even though his compensation is based on the ultimate claim settlement, he says that even after paying the fees, presenting the claim and negotiating it, the net settlement number is almost always more than what they would have gotten trying to “muddle” their way through the process.

“Sometimes we make the insurance adjusters’ life a lot easier because we know exactly what's needed to pay the claim,” he said. “And policyholders don't know sometimes and that causes them a lot more time and energy than [it needs] to. But we can say we know everything you need, we're going to put it together – and exactly the way it needs to be – because we want to make it super easy for them to pay. So, in some ways, we make life a little easier.”

Making the claims process easier

After visiting Maui several times and with more trips scheduled on his calendar, Severaid is thinking a lot these day about the things people can do in advance of a disaster, to make the claims process easier and make sure they receive all they are entitled.

It’s expected there will be claims totaling $2 billion to $3 billion from the Maui fires and already there are reports, denied by insurance companies, of insurers denying claims because of zoning infractions in which properties are in violation of zoning regulations. Anticipating the deluge of claims, the state issued a declaration the day after the fires were extinguished, temporarily allowing independent adjusters who don’t reside in Hawaii to help process the claims. One big insurer in the state has already been hit with more than 600 claims, according to Hawaii’s insurance commissioner.

”One of the biggest things that people don't do a good job of is preparing their inventory – all the things in their house,” he says. “Whatever you prepare and give to the insurance company they will question you about some of the items, they will question the prices you put down, they'll argue with you about things, they'll apply depreciation – they'll do all those things. Regardless of how good or bad a job you do, they're still going to argue with you regardless.”

Public adjusters like Severaid’s company have inventory and depreciation specialists and can put accurate values on everything from giant TVs and furniture, to postage stamps and paper clips.

“The little stuff can make an enormous difference in how much you end up getting paid,” he said. “People will say, for example, they have a junk drawer in the kitchen that might have $100 worth of stuff in it. But the insurance company wants an itemized list that doesn’t add up to $100. Our team will go through the items and find that the stuff in that $100 junk drawer just became worth $500.”

Doug Bailey is a journalist and freelance writer who lives outside of Boston. He can be reached at [email protected].